tv Nightly Business Report PBS March 9, 2018 5:00pm-5:31pm PST
report," with tyler mathisen and sue herera. hiring surges. the economy cated a lot of jobs last month, but wage growth was muted. exactly what wall street wanted. toys are not us. the iconic ouretailer close all its doors, leaving a big hole in the toy industry. m success f socks. a father/son team took a bright idea turned it into a million-dollar busngess, smashi stereotypes alone the way. those stories and more tonight on "nightly business report," for friday, march 9th. >> good evening, everyone, and welcome. glad you could join us. what a way to end t week. stocks rallied and rallied big. the dow jos soared 44 point
25335. the s&p gained 47 after the monthly jobs report for february turned out to be what wal street hopedfor. wall street and main street cheered the creation of 313,000 jobs a lot more than expected and a very steady unemployment 4.1%.of wages were up, but not a lot. easing investor concerns about a rapid acceleration of wages and inflation. hampton pearson has more on the rosie jobs picture inic am >> reporter: in february, employers went on a hiring binge, adding 287,000 new private sector workers to payrolls. on the way to the biggest monthly job gain in nearly two years. construction led the way w 61,000 new workers. professional and business services and retail each added 50,000ew hires. and manufacturing continues to rebound, with 31,000 jobs.
the unemployment rate remained at 4.1%or the fifth consecutive block because of a e blockbuster ie in the size of the labor force, up 806,000, the biggest monthly gain in 35 ars. the treasury secretary wasur encoed by news of more job eekers returning to the labor force. >> everyone has said aren't you concerned abouton infla given we are at full employment and given thendax cuts the growth in the economy? and my comment s we are not really at full employment because of the participation rate. so i'mas p it ticked up a little bit. that's a number that i'm very focused on. >> bro wageh actually slowed down from previous months, up just 276% or the last 12 months to $26.75 per hour on average. not the best news for main street but easing market concerns about inflation and the
federal. >> this economy seems incapable of producing scary inflation. i think that's the most important message re. that's positive for both stocks and bonds. federalter: the next reserve meeting is less than two weeks away. one monetary policy mak says today's jobs report, withjo hug b gains, and no sign of io infl gives the fed time to wait and see before raising interest tes. >> my own preference would be to wait a little bit longer, let the march inflation, anomalous inflation rate from a year ago that.ut of let's make sure these sort of amazon disrupte kind of pricing models aren't continuing to finding their way into keeping inflation lower than that. >> reporter: their economic x factors in the month ahead. first the expected boost for both businesses consumers from the trump tax cuts. perhaps the biggest speed bump, the coming tariffs o steel a aluminum, and their impact on the job market. for "nightly business report," i'm hampton pearson in
washington let's turn now to anthony chan for more on that stng jobsreport. he is the chief economist over at chase. anthony, always good to have you on the show. thank you for joining us. >> glad to be here. >> was thi report as as wall street seems to think it is? >> i think that this reportave you some good news on a few fronts. first of all, you have more jobs being created than the market was expecting. at the same time, you don't see wage pressures that are so concerning that the federal reserve has to end the party a little early.he and i think reason for that is pretty simple. we had a lot of people re-entering the labor force. and remember when new people come into the labor force they usually don't have a strong bargaining position when it comes to i think with as. i wink that'st is restraining wages. >> this was an extremely strong number it seems to me in terms of the number of jobs add, in terms of the number of people who came back to the work force. what does it tell you about h strong this economy is? and do you worry that it could get at some point into that
overheating phase? >> i don't thi that forhe moment i'm really concerned. what i'm more concerned about is that productivity growth doesn't seem to be accelerating. if you look at theumber of hours worked and what the labor input into the first quarter, that's probably goingo be or a little bit more. and i look for economic growth to be o2% a little bit more in the first quarter. so thateans we are not getting a lot of productivity growth. we need productivity growth because whenever you see wage gains if they are not uctivityied by-pr growth then that has the potential to become inflationary. so far, the inflation is still contained but i want to see some productivity growth. >> the treasury connect on cnbc flagged the participation rate as one reason w he is not worried about inflation. what do you make of that participatio rate? >> well, everybody will look at the participation rateea in. and they say that's great news. that in fact is exactly what you
want to occur so that inflationary pressures don't get out of control. one other number that i look at is the numberef peo working part-time for economic reasons. that actually jumped in the late month. and those are individuals that actually want to work longe hours. and they don't necessarily demand higher wages toork longer hours. they actually want to do it. so that's another factor outha thereis restraining overall wage pressures. keep in mind that when you look atehe cha in the labor force over the last 12 months it's running almost twice as fast as the increase in the lab force that we saw all of last year. so we continue to labor force, bringing people from the fringes into the labor force. th's going to also be another restraining factor for wages. >> on that note, anthony, thank you as always. anthony chan with chase. >> and that strong jobs report came on the nine year anniveary of the bull market, one of the longest you of all time. how much longer can this bull run? mike santoli tackles that one.
>> there is a way to view the past nine years as three shorter bull eruns. thirst of the three phases wa the initial burst off the march 2009 lows as the global financ wl crisis ending and stocks were depressed. federal reserve support and a slowly rovery economy helped send the s&p 500 whistling higher about 100% over the nee two years. in mid 2011-the european debt crisis and fears of a u.s. government default send the s&p 500 down 19%. slightly short of the popul 20% threshold that defines a bear market. that fall, the next mini bulleg run as the economy survived and energy prices surned s drivingcks up another 80% until mid 2015 when the oil cras global profit downturn caused a seven mth market correction. industrial energies and small cap stocks loste m than 20% in
what some call another stealth bear market. the market bottomed in 2015, and accelerated after the election of president trump. now with the strong u.s. economy getting a heavy dose of tax cut stimulus the federal reserve is set to raise rates in the coming weeks and months. this cases debates over whether th expansion can persist. it might mean this cycle is not as old as it first seems. for "ghtly business report," i'm mike santoli. the head of goldman sachs is reportedly planning to step down as soon as the end of the year. according to the "wall street jonal," of 3-year-old lloyd blankfein remains in control of the timing of his exit. and today he tweeted out a rye tweet about just that. quote, it is the "wall street journal's" announcement, not mine. i feel like huck finn to his own yule gee.ei
blan has been ceo over the past dozen years and saw it through the financial crisis 's expected one of goldman's copridents willucceed him. shares of goldman rose today. since blank fine was named ceo in 2006 the stock is up t75%. ovt same time the s&p has more than doubled. toys r us once considered the leader in toys may be on the verge of shutting awful its u.s. stores. it could mark a new chapter for the entire toy industry. >> it's been more than six decades since the first toys r us stores opened its door it may be just a matter of weeks until all remaining stores open for the last time. toys r us filed for bankruptcy in september and has been working througho plan restructure its business. it has already closed around 200 stores. under the law, companies only et 210 days to negotiate all leases, which for toys r us is hundreds more stores. with just over a month left, the
toy retailer is running oust time. bankruptcy experts say if toys r us and its landlords can't come o agreements by the deadline liquidation is all but inevitable. walmart sells the most toys in the u.s. it's estimated target is second, followed by amazon. toys r us isn't in the top three but it's still important to toy makers. one analyst is considering how a fulloys r us liquidation will you are the had had. 4% of hasbro's sales come from toys r us and 8% of matel's. it's estimated hasbro could withstand the liquidationan betr th matel.es keybank estimp to 80% of has row and matel's toys r us business will ultimatel be absorbed by other retailers but it couldye take twoars. ner "nightly business report," i'm cou reagan.
time to look at some of today's upgrades and down grades. cole's ratings was upgraded cot cowen. they point to new products and a new stra gy. the pritarget, $74. shares today closed up 1% to 62.97. wells fargo lower its price target on cigna to $175 a share. the firm cites concerns around cigna's long term growth outlook. the analyst also says there are risks around the of were of express scripts which of course we told you about yesterday. the stock was up to $173.36. >> still ead, jail time for the man who became known as pharma bro. first a look at the week's strong performance for stos.
intel is reportedlyco idering a bid for broadcom. according to the "wall street journa" the company is considering a range of options in reaction to broadcom's hostile o pursu qualcomm, including a bid for broadcom itself. >> wynn resorts has agreed to ha ipo pay more $2.5 billion to settle a lawsuit brought by a japanese slot machine company ending a six-year dispute. the settlemen could clear a path for steve wynn, the company's biggest shareholder and formerrm ch to sell part of his stake in the.can. the new ceo says the deal allows him to focus on the future. >> it was taking the air out of room. d so when i looked at it, i thought, buying back 24 million shares of stock at $78 financed to the 6% interest rate is great for our shareholders. so just make that deal and be done. >> steve wynn of course resigned
from thee company founded last month amid allegations of sexual misconduct against employees. martin shkreli, the former farm suitcal executive who became known asas pharma bro w sentenced to seven years in prison for defrauding investors. meg terrell is athe courthouse brooklyn. a federal judge has sentenced martin shkreli to seven years in prison for on his conviction of three counts of securities fraud and conspiracy to commit securities fraud. that stence will include credit for the time he has already served in prison, about si months already. he will also have to pay a o5,000 fine and be subject to three years probation after his release. the judge had already ruled that he will hav to forfeit about $7.4 million in association with those crimes, whi have too with former hedge funds that he ran and illegallyontrolling the sha prices or attempting to, at a former biotech company that he ran.
they don't have anything to do with what made s martireli famous and earned him the monike pharma bro. that was when he bought the rights to an old medicine and raised the price by 5,000% overnight. the government prosecutors had been seeking atence in these crimes of at least 15 years in prison. skrelry's defense team had been seeking 12 to 18 months. >> when the guidelines are 25ar and the government is demanding o 15 year would think that a seven-year sentence is good. but i'm disappointed. i thought the sentence should have been less than seven years. but you know, martin is fine. and he wi be fine. and obviously it could have been a>>ot worse. efore the sentencing shkreli had an opportunity to address the judge. he got emotional at times, even breaking down intears, telling her he had made mistakesi but
saying quote tmore is so much i want to do courthouse. sales growth disappointed big lots. that's where we begin tonight's market focus. the retailer said weakeremand in its furniture category caused sales to slip every. the company is renovating its stores to put a stronger emphasisnin fre and seasonal items. big lots expects profits for the quft and full year to miss estimates. and shares were off t10% ons up day. they close at $48.45. >> party city reported quarterly profits and sales that topped analyst expectations. revenue for the full year also picked and the company's gross margins improved. ares finished up more than 7.5% at >>$15.65. merger talks ben agricultural companies haveptedly come to a halt. the "wall street journal" says the two companies failed to reach an agreement following talks on how to avoid anti-trust issues. shares of archer-daniels-miand were up penny to 43.30. meanwhile,s bungee sha fell
more than 2% to $74.96le genera electric is reportedly considering engineering business. they bought it in 2011 for $3 billion. a potential spin-off will likely fetch much less. ge shares were up 4%. this week's market monitor says spider s&p biotech etf, up %.%. google, up and alibaba, 25% higher. we are goingni to go l round here. ron, your first pick is. >> about of america. why? >> we like all the financials right now. interest rates are going up. theyre going to make we call net interest income. it's going to fall to tir bottom line by charging more from people who borrow. we like that the tax rates is going up from 30 to ik20. we they are going to be
lending more because of a growing economy and they are not that cheap. makes sense. we le them all. we actually like regionals even b better. >> you united rentals. you wouldn't think of a digital strategy with united rentals. but that'e one of easons that you like it? >> they say people went outo the gold rush to find gold and levi strauss made all the money selling them jeans. this is what they are doing. what they are doing is they will rentou anything for business. they also made an acquisition last year of a company that sell caterpillar type equipment or that rents it. with infrastructure, with increasing cap ex, which is expected. tey were s about eight quarters. they had soft rentals. now the aare turnedund and seeing stronger rental rates. we like that going forward. >> and your final pick is a
departure from those first two. it is nvidia, one of the leading semiconductor companies involved in self driving vehicles and autonomous intelligence. >> we're high on a company that's done incredibly well. you have to look at when eisenhower blt out the interstate commerce system in the united states, it changed everything. whether you bought chrysler or gm or ford it didn't tter. reynolds aluminum or alcoa, it dn't matter. it was the infrastructure build out. now we have the technology build out. those cars areoing to need many chips. there are going to be man nners around the world. nvidia knows how to do it well. hat aree chips lightning fast. >> thank you ron. to read a moreut his stock picks head to our website,
omb.com. g up, a young entrepreneur who i really socking it to them. tonight's bright idea is next. 10ea ago people with the chromosome disorder known as down's syndrome could expect to live tep years. that's all. today they canxpect to live into their 50s shlg even longer. but the labor force participation rate for people with any disability in the united states is oybout 20%. that's one reason a young entrepreneur with down'snd me got the bright idea to start his own business, selling socks. >> down's syndrome ever hold you
back? >> down's syndrome never hold me back. >> in fact, one might say john krohnan's disability helps push him forward. starting his last year of high school in 2016 on new york's long island, john thought maybe he and his father, mark, could start a business together. >> we walked and talked about starting a food truck.s but a he points out neither of us can really cook. >> instead, john cooked up an ea to sell socks. >> i think it's fun. i think they are colorful. >> john, his wholeli fe, had worn corful crazy socks. it was kind of his thing. >> john lemon stocks. >> reporter: they uild a website, and by december2016 they were on line and in business selling more than $13,000 worth of sks in a month. john delivered a lot of them
himself, a long with thank you notes. what that extra mile i john is all about. >>ight away, we had people telling all the things john couldn't do. and john has spent his life demonstrating what he could do. >> john, an avid snow shoer and soccerer pl also decided to donate a portion the company's profits to the s cialolympics. a cause he even lobbied congress for. >> people right away saw him as a role model. i had to wrap my head about that because he is just my son. >> last february he designed a down's syndromere awaness sock. for 2018 theres a new version. >> i did it in yellow because it'sdown's syndrome colors. >> of the more than 1700yp different t of socks they tell, there are socks aimed at raisingss awarene of eight autism,nc breast ca, and other causes the company donates too.
and somehow, john also goes to trade shows to find new products. he participated in ama achusetts startup incubar. and he has travelled to do speaking engagements. it's been quite a year, and business hasn't been too bad th . >> we shipped over 42,000 orders. and we did $1.7 million in revenue. >> but this story is less about dollars and more about what makes sense. john is lucky. disabilities ith have few options after high school. >> it's scary. the next big frontiers employment. >> john's crazy socks has grown to employ 34 people, 146 whom have disality. >> i go to warehouse and i get it ready for shipping. iew learned to make friends, and i get along with everyone. and that's what makes me happy. >> we want the world to see what's possible when you give someone a chance. things are not segregated here. erybody works side by side. and it is a better workplace
because of that. >> i love you. >> i love you, too. >> when one where going that extra mile comes naturally. >> we have to succeed. if we don't, we are letting these guys down. and we have to show other businesses you can do this, too. >> wha a guy. that new down's syndrome awareness socks that just becomi ble ahead of the seventh annual world down's syndrome day on march 31st. at's 3/21 because down's syndromeec a the third copy of the 21st chromosome. before we go, we have news tohare with you. ai is taking on a new role at cnbc. he is the vice president ote event st, among other things. congratulations. >> thank you very much. >> ohowever, that a means that he will no longer be thenc cor of "nightly business report." starting on monday, bill griffith will be jning us every night. i'm going to -- i have got to
get x.klee sorry. sorry. >> you know, i have been accused of nothing that i know of so far. bill andsue, you will be happy to know, have known each other and worked togetllr since e days. >> yep. >> that's probably five years ago at least. >> maybe. >>ive years ago at least. congratulations to bill. to you, my sincerist an. to sues 'garab my sincerest thanks as well. keep coming back to nbr. itl won't change and it will continue to be the best place to get your business news every news w.that, thank you for watching "nightly business report." we want to remind you this is the time of your wherebl your station seeks your support. have a good night.
>> this is "bbc world news america." funding of this presentation is ma possible by the freeman foundation, and kovler foundation, pursuing solutions for america's neglected needs. escapening a vacati that is relaxing, inviting, and er thang is a lot ea you think. you can find it here in aruba. families, couples, and friends can all find their escape on the island with warm, sunny days,ol cog trade winds, and the crystal blue caribbean sea.to noflights are available from most major airports.